December 26, 2013 / 10:47 AM / in 4 years

UPDATE 1-Lafarge sells gypsum stake to Etex for 145 mln euro

(Adds background, debt detail)

PARIS, Dec 26 (Reuters) - French cement maker Lafarge said it would sell its remaining 20 percent stake in its former European and South American gypsum operations to Belgian building materials group Etex for 145 million euros ($198 million) in cash.

The transaction is expected to be completed in the coming weeks, the company said in a statement on Thursday. Lafarge had sold 80 percent of the business to Etex in 2011 but retained a minority holding.

Lafarge has been shedding non-core assets and refocusing on cement and concrete after the debt it racked up to buy Middle Eastern cement maker Orascom led to the loss of its investment grade rating in 2011.

The world’s largest cement maker wants to reduce its debt pile below 10 billion euros this year and 9 billion in 2014. Net debt was 10.94 billion euros as of Sept. 30.

Lafarge also set a new target in November to boost core earnings by at least 1.1 billion euros over 2015 and 2016 partly through additional cost cuts of 600 million euros.

Lafarge agreed to sell its North American gypsum business earlier this year to U.S. private equity firm Lone Star for $700 million. ($1 = 0.7317 euros) (Reporting by James Regan; Editing by Geert De Clercq and Peter Graff)

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